P

rivate lender Bank Central Asia (BCA) has set its sights on micro consumers as it gears up to launch new projects, initiated by the Financial Services Authority (OJK) and Bank Indonesia (BI).

BCA president director Jahja Setiaatmadja said the projects would be the bank'€™s attempt to venture into the micro business, a segment it had never before touched on.

'€œWe have secured OJK approval to carry out the Laku Pandai pilot project in Cipulir [in South Jakarta]. The project will begin in late March or early April,'€ he said during a recent public expose.

Laku Pandai is an OJK-initiated program, aimed at providing micro access toward savings and loans for rural communities across the country that are mostly unbanked and underbanked.

Under the program, participating banks are required to recruit agents '€” both individuals and legal entities '€” to provide basic saving and loan products to the people.

BCA retail and commercial director Suwignyo Budiman said the bank was interested in entering the micro market due to its novelty.

'€œBut this is certainly something that needs a lot of attention because we have never done it before,'€ he told The Jakarta Post over the telephone on Monday.

He added that BCA was in the process of recruiting individual agents to run the project.

The OJK'€™s Laku Pandai regulation stipulates that individual agents must have their own income for at least two years, reside in the Laku Pandai project area and pass a due diligence test carried out by the bank.

It also says that the saving product must have a maximum balance of Rp 20 million (US$1,532) per person, while a loan product must carry a maximum value of Rp 20 million per person.

Suwignyo said the first product that BCA would launch would be a saving product.

Meanwhile, BCA is gearing up for its Digital Financial Services (DFS) project as well, according to Jahja.

The DFS '€” a BI-backed program '€” is directed at underbanked and unbanked people, similar to Laku Pandai.

It will provide them with easy digital payment services at their fingertips by using cell phones.

However, only banks within the BUKU IV category '€” with core capital of a minimum Rp 30 trillion '€” can partner with both individual agents and legal entities to offer the products.

Other banks with lower capital may join the program, but they are required to cooperate with legal entities to mitigate risks.

BCA itself, according to a 2014 financial report, possessed up to Rp 64.37 trillion in core capital by the end of last year.

'€œWe have acquired BI approval for the DFS and hopefully we will be able to conduct the project at the beginning of April,'€ Jahja said, adding that at present, the bank was also in the process of selecting individual agents for
the DFS.

BCA'€™s DFS project will be carried out in several towns, namely Jepara and Wonogiri in Central Java, Wonosari in Yogyakarta and Jombang in East Java.

Suwignyo said BCA had developed a new system to support both its Laku Pandai and DFS projects and that it was looking to test it before the projects began.